Author Topic: Half way to FI, don't want to work another job - should I slowly switch to PT?  (Read 5663 times)

blizeH

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Hi,

I'm currently around half way to FI, and rather than retiring early, I would like to continue in my current job working part time if possible. However, I'm wondering if now that I am half way, I should start slowly considering dropping my hours at work?

For example, I can 'buy' an additional 20 days annual leave (so I can have every other Wednesday off for example) without it having much impact on my pension, or any impact on my redunancy pay etc - switching to part time would have a big impact on both of these things.

So I'm very tempted just to go for it, buying as much annual leave as possible instead of switching to part time before I become FI? My only worry is that if I do lose my job before becomming FI, I may regret not coming in during those days and regret not saving as much as I possibly could while I had the chance.

So, what do you guys think I should do? Carry on as I am now, or bite the bullet and buy the annual leave?

Thanks :)

(for disclosure - I don't want to never work again as such after this job, I just don't want to be in a position where I have to take on a job I hate just to get by, or have to do a lengthy and stressful commute each day etc)

happy

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Knowing this board I think you'll get a split between two responses:
1. keep at it full-time and full steam ahead to FIRE asap
2. buy the 20 days A/L for improved quality of life, and if it takes a little longer thats ok.

Personally I'd go for the second, but I've been working part-time for 19 years: downshifting, semiER  and so forth is how I like it. I have pretty high job security so I don't worry about running out of work.

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So I'm very tempted just to go for it, buying as much annual leave as possible instead of switching to part time before I become FI? My only worry is that if I do lose my job before becomming FI, I may regret not coming in during those days and regret not saving as much as I possibly could while I had the chance.

Alternatively if you develop a stress related illness  from overworking  ( or even worse some illness or misadventure within your family) you will regret not taking the time off to enjoy life and your loved ones.

Cpa Cat

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I would definitely buy the 20 extra days of vacation.

As for part time - it really depends. How many years would that extend working until FI? How much of an impact would it have on pension, etc?

Regarding the job security question - I wouldn't consider that a main concern. If your job is not secure, it won't be secure whether or not you buy the leave, and you'll probably end up needing to find new work either way.

And if it is secure, then no problem.

HairyUpperLip

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Knowing this board I think you'll get a split between two responses:
1. keep at it full-time and full steam ahead to FIRE asap
2. buy the 20 days A/L for improved quality of life, and if it takes a little longer thats ok.

Your responses will be variations of this over and over.

Some will write a book giving you the same options.

I'd personally rather just go hard and finish. Don't understand the point in PT unless you love what you do.

UlyssesG

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I'm in the same boat.  I took the extra days, in my case it was 12 per year, and its made the job so much better.  I take a random day off here and there to go to the aquarium, the park, build stuff and spend time with family members.  This option not only improves my work days because I get some separation from the rat race and come back refreshed but also improves my pension calculation down the road through additional service time opposed to quitting a few months earlier.  I'd rather enjoy the next few years a little bit more than add three months to my 50 year retirement.

mcneally

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It's a very personal decision like asking 'should I marry this person', but my plan is to go down to 4 days a week at age 35 (28 now) when I expect to be ~60% to FI, then down to 3 days when closer to 100% if I want to . A big factor in me wanting to stay part time is the pension, but I'm also worried i'd become an unhappy hermit if if I ER'd at 40. I could cover my expenses working 3 days week right now but I do highly value having FU money.

MicroRN

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We'd reach FIRE much faster if I worked FT (and picked up the OT they're always begging me to take), but I love working PT.  I work 2-3 days a week and have plenty of time to spend with my kids.  I also enjoy what I do, but feel I might get burnt out if I worked at it too much.  PT keeps the work fresh, I actually enjoy going in, and feel like I could do this forever.  Eventually I plan to drop down to per diem.  I'd probably do the same schedule most weeks but I could take off on vacations easily.  I'll probably always keep a per diem nursing job until I physically can't work any more, just in case.  Some of them only require 2-3 days a month to stay active. 

ch12

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I'd buy those 20 days in a heartbeat. I'd love to get an extra day a week off, and I'm in what the ERE forums consider a skate-by job.

bugbaby

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Well, the reason your responses will boil down to personal preference is the sparse info in your question.

Guys here tend to like analytical, meaty puzzles to exercise their mustachian muscles of problem-solving prowess....

For instance: what do you mean 'half way to FI' - Is this 1/2 of the 'magic number' or 1/2 the number of years? What about safety cushions? What's your overall life situation? How many years to FI are we talking? Is the current velocity toward FI expected to change by 5% or by 40% if you kept status quo vs PT? How do you feel about your job? Is it a stressful life-sucking deal right now or just ok, and how much more happiness will you gain by changing to PT / buying the 20 days?

Not asking you to delve into all this if you don't like, but it would make the question more vivid.
etc etc

blizeH

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Thank you all very much for the responses, to answer your questions babybug I am around half way to the 'magic number' and at my current rate will hopefully hit it by my early to mid thirties. I live with my partner (soon to be wife) who has recently started a lingerie business which I have not accounted for, though already she seems to be turning a profit which is promising. My job isn't overly stressful though there are parts of it I could do without :) But I guess that's always the case. I'm happy enough working here and even if I was completely FI would still like to work here part time.

I think I would gain some happiness from having the extra days, and whilst I'm sure some would be wasted by me doing very little (not always a bad thing) I'd also make sure to try to make good use of them, either by being productive and doing things around the house, or going away on short breaks, or just exploring the local area some more :)

Reading through the posts here I've decided I'd definitely like the days off, I'm just now concerned that if I ask for them, it would look like I'm not committed to the job? idk

TomTX

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Take the days off ;)

nereo

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how stressful can life be when you are marrying a woman who owns a lingerie shop ;-)

but seriously, one point I thought I'd throw out there that hasn't been voiced yet is that the closer to your FI number you get, the less impact adding to your savings has.  Depending on how large your "FI-number" is and what your annual saving contribution is, I'm estimating that your annual additions are less than what you will earn on an average ~7% return year.

Impossible to know for sure without your specific numbers, but I did a mock-simulation for myself and determined if I reduced my annual contribution by 50% (about what would happen if I worked 20 fewer days at my old job) it would raise my FI date from 7.7 years to 9.8 years.
So about two years more work for a lot more free time while I am working.  Is that worth it to?  up to you.

happy

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Good point Nereo.

Looks like all the down shifters have come out to play!

blizeH

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how stressful can life be when you are marrying a woman who owns a lingerie shop ;-)

:D It's pretty good, and we've had a couple of 'business trips' (including one to Paris) already so I'm really looking forward to more of those! I'm a web developer so help with her site, I think that will be my plan when I become FI, to try to help with her business more than I do right now. That, and create my own video game that no one will ever play.

I'm estimating that your annual additions are less than what you will earn on an average ~7% return year.

Damn, I wish this were true! The 7% would (just about) cover our expenses right now, but unfortunately I still have a long way to go.

And thank you once again all of you for your advice :)
« Last Edit: May 20, 2014, 06:35:38 AM by blizeH »

nereo

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I'm estimating that your annual additions are less than what you will earn on an average ~7% return year.

Damn, I wish this were true! The 7% would (just about) cover our expenses right now, but unfortunately I still have a long way to go.

And thank you once again all of you for your advice :)
BlizeH - I think you may have not understood what I was trying to say - no doubt because I didn't explain it well enough.
What I meant was that as your 'stach grows, your annual returns increase.  On a dollar-for-dollar level, when you first start saving the amount that you earn in interest is pretty small, and virtually all of the growth in your portfolio comes from your periodic contributions.  But as your portfolio gets bigger, the amount of growth that comes from returns eclipses your contributions.

You stated that you have reached the 'half-way' point towards your FI number.  At this point, the majority of your portfolio growth is most likely going to come from returns instead of contributions.  Consequentially, "scaling back" your annual savings in favor of working less will matter less and less each year.  How much time it will add to your ultimate FI date is a function of your number, your savings rate and your returns, but I think my estimate of cutting your savings by 50% and reducing your workload by 20 days/year (four extra non-paid weeks of vacation!) will give you a ballpark of 2 extra years until FI-day.

hope (?) that makes my point a bit clearer?

blizeH

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Oh I see! That's a really good way of looking at it, thank you Nereo :)